Price of sugar : gvt approves an increase of 14 %

The inflation tsunami is coming, by waves.

The government has agreed to increase the price of sugarcane by 14% to 800 baht per tonne as requested by cane farmers, saying planters deserve a better price to cover rising production costs. Cane farmers have been receiving 700 baht per tonne of cane sold under the previous price set by the state Office of the Cane and Sugar Board (OCSB).

However, planters have been lobbying since last year for an increase to 800 baht, saying that their production costs have surged in line with more expensive labour as well as increases in fertiliser and fuel prices.

Thailand relies heavily on the world price as a benchmark as only 30% of its production is for local consumption and the rest is exported. (Bangkok Post)

Yes, eventually, even the thai government has to deal with basic market laws… “to cover rising production costs“, they say… it’s rather funny to hear them say that.

Because according to this market law… the price of many other products and services should be increased. Right now.

But the official policy is to postpone, delay hikes, to control prices and to subsidize… Until one point. The tipping point, what I call the inflation tsunami, when it’s impossible anymore to avoid hikes.

Sugar is a basic commodity, used in food preparation (a lot in Thailand) and beverages industry… You can be sure that soon… we will hear other voices… asking for permission to increase the prices of their products using… sugar.

UPDATE APRIL 30
Actually, it’s more. Read my article here.

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